Life in Europe – another day, another (futile) bailout

From http://bilbo.economicoutlook.net/blog/?p=9632">William Mitchell:

Last Wednesday (May 5, 2010) I wrote that Bailouts will not save the Eurozone in response to the miserable plan put forward to take the Greek government out of the bond markets for a period. Yesterday they announced a major ramping up of the credit line they are offering which is more characteristic of a fiscal rescue than anything else. However, it amounts to the blind leading the blind. The euro funds to finance the credit line are coming from the same countries that are in trouble. There are no new net financial euro assets entering the system as a consequence of this €750bn bailout plan and, ultimately, that is what is required to ease the recession and restore growth. The restoration of growth will also ease their budget issues. But this is Europe we are talking about. Despite the nice cars and bicycles they make, they are not a very decisive lot and their institutional structures are hamstrung by an arrogant sclerosis that pervades their polity and corporate world.

Apart from the obvious consistency issues that these “bailouts” pose for the design and rules of the EMU, the fact is they are missing the point. The problem lies in the flawed design of their system.

I particularly liked this opening gambit by UK Guardian commentator Larry Elliot in his May 19, 2010 article – IMF has one cure for debt crises – public spending cuts with tax rises:



That about says it all. Elliot puts the only question that needs to be answered “Why is it that the IMF’s medicine for Greece is exactly the opposite of what every other country did to stave off recession?”

What does the IMF and the EMU bosses think will happen in the countries they are imposing these austerity plans on?

First, the IMF knows that the “immediate prospects for the Greek economy … (are) … bleak” (quote from IMF boss Dominique Strauss-Kahn). They know full well that trying to cut a budget deficit when an economy is in a deep recession devastates local demand and economic growth.

Second, these austerity programs used to be called SAPs (Structural Adjustment Programs). They are deliberately designed to ensure that the public-private balance in an economy is irrevocably altered towards free markets and private production at race-to-the-bottom wages and conditions.

http://bilbo.economicoutlook.net/blog/?p=9632">more...

1%ers want

last week that they could "make a lot of money" by destroying the Greek economy. They said "after that, we can start in Europe and soon we'll be in California."

http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=385x464274

This was reported on another thread by Thom Hartman. What these "guys" are doing, since deregulation, is legal. This is Fascism, the corporate takeover of the world at the expense of the huge percentage of the "regular citizens. This must be stopped immediately. Hell, America (Paulson and Geithner) gave these guys the "bailout" money to destroy the world. Last month the "Wolfpack" paid themselves an amount equal to the entire debt of Greece...
Wake up people we've got to take to the streets too.

We Yanks are far too meek and quiescent to take to the streets. If not, why the hell didn't we take to the streets during the 2000 election? And especially after the gutless supreme court decision that installed the Village Idiot? Answer, we don't care.

but this time it is about ruining the entire world economy. I am hopeful we can get talk show hosts , etc... to sponsor (?)/support, this hopefully, massive turn out. It really needs to be encouraged and done.. people must wake up or perish in the flames. I did in the 60's but now it's global.